Bitcoin – Gold Coast Money Onlinehttp://goldcoastmoneyonline.com
We know the value of your moneyThu, 22 Feb 2018 05:32:16 +0000en-UShourly1https://wordpress.org/?v=4.9.3Bitcoin Price Technical Analysis for 02/22/2018 – Potential Bounce Targetshttp://goldcoastmoneyonline.com/2018/02/22/bitcoin-price-technical-analysis-for-02-22-2018-potential-bounce-targets/
http://goldcoastmoneyonline.com/2018/02/22/bitcoin-price-technical-analysis-for-02-22-2018-potential-bounce-targets/#respondThu, 22 Feb 2018 02:40:02 +0000http://goldcoastmoneyonline.com/2018/02/22/bitcoin-price-technical-analysis-for-02-22-2018-potential-bounce-targets/Bitcoin Price Key Highlights Bitcoin price is still in correction mode but appears to be bouncing off the trend line support. Applying the Fibonacci extension tool shows how high price could go if the trend line holds. Technical indicators are signaling that the uptrend is about to resume. Bitcoin price is finding support at the …

Bitcoin price is still in correction mode but appears to be bouncing off the trend line support.

Applying the Fibonacci extension tool shows how high price could go if the trend line holds.

Technical indicators are signaling that the uptrend is about to resume.

Bitcoin price is finding support at the area of interest on the trend line, 200 SMA, and $10,000 mark so the rally might resume from here.

Technical Indicators Signals

The 100 SMA is above the longer-term 200 SMA on this time frame so the path of least resistance is to the upside. This means that the rally is more likely to resume than to reverse. Also, the 200 SMA lines up with the rising trend line connecting the latest lows.

Stochastic is pulling up from oversold levels to signal that bullish pressure is returning. Similarly, RSI is also turning higher to show that buyers are ready to jump back in.

A bit of bullish divergence can be seen on stochastic as the oscillator formed higher lows while price had lower lows. A bounce could take bitcoin price up to the 38.2% extension around $11,000 or the 50% extension at the swing highs.

The 61.8% extension is located at $12,000 or another long-term area of interest. The 76.4% extension is at $12,788 then the full extension is at $13,590.

Market Factors

The US dollar enjoyed another wave higher on hawkish FOMC minutes and risk aversion. Policymakers agreed that stronger growth momentum could warrant further tightening in the months ahead.

This led to higher bond yields and another weak close for US equities as business and consumer activity could be dampened by higher interest rates. Note that bitcoin price has been trading alongside stocks and commodities, so the dip also affected the cryptocurrency.

Nonetheless, it’s still worth noting that bitcoin sentiment has improved after a few nations have expressed the need to keep the door open for industry developments. Then again, some top financial officials have made negative remarks on bitcoin, particularly on its ability to be a store of value.

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]]>http://goldcoastmoneyonline.com/2018/02/22/bitcoin-price-technical-analysis-for-02-22-2018-potential-bounce-targets/feed/0Here's What Bitcoin Must Prove Before Goldman Sachs Would Investhttp://goldcoastmoneyonline.com/2018/02/22/heres-what-bitcoin-must-prove-before-goldman-sachs-would-invest/
http://goldcoastmoneyonline.com/2018/02/22/heres-what-bitcoin-must-prove-before-goldman-sachs-would-invest/#respondThu, 22 Feb 2018 01:47:04 +0000http://goldcoastmoneyonline.com/2018/02/22/heres-what-bitcoin-must-prove-before-goldman-sachs-would-invest/Goldman Sachs thinks it may have found Bitcoin’s biggest problem: It doesn’t have one. No, that wasn’t a trick answer. In a new missive this week, a top Goldman Sachs (gs) investment strategist explained what Bitcoin and other cryptocurrencies would need to do to justify their prices, which have recently rebounded after a sustained crash. …

Goldman Sachs thinks it may have found Bitcoin’s biggest problem: It doesn’t have one.

No, that wasn’t a trick answer. In a new missive this week, a top Goldman Sachs (gs) investment strategist explained what Bitcoin and other cryptocurrencies would need to do to justify their prices, which have recently rebounded after a sustained crash.

“We believe that the crucial question underpinning the real value of cryptocurrencies themselves, is what economic problem they actually solve?” said Allison Nathan, a senior strategist of global investment research at Goldman Sachs, in a new video released by the bank. “As a currency, cryptos can often seem like a solution in search of a problem.”

It’s a classic “if it ain’t broke, don’t fix it” argument: After all, Nathan observed, traditional fiat money and banks work just fine in the majority of the world. “There just doesn’t seem to be a need for digital currencies,” she said.

It’s only in “some corners of the world” that lack reliable banking systems and stable local currencies where “cryptos could be a viable alternative,” Nathan continued. Venezuela, for example, where high inflation has shaken confidence in the local bolivar, this week launched its own oil-backed cryptocurrency called the petro, and Bitcoin has also caught on in politically unstable places like Zimbabwe and in other underbanked African nations.

But while Goldman Sachs does acknowledge that cryptocurrencies “solve the economic problem” of keeping money outside the regular banking system—a function that also attracts criminals—this is a relatively minor opportunity.

The bigger opportunity—and critical question—lies within the major banks themselves, and in whether Bitcoin and its digital peers can disrupt and displace traditional currency and commodities on Wall Street and beyond. “When it comes to regulated markets, we believe that gold is a superior store of wealth to Bitcoin or other cryptocurrencies and a long list of hurdles remain for that to not be the case,” Nathan concluded.

Echoing another Goldman Sachs research note earlier this month, Nathan raised the possibility that some of today’s top cryptocurrencies “are likely to trade to zero” when they are replaced by “new and improved” versions—”a risk that we believe is underappreciated in the market today.”

Goldman Sachs, of course, is far from the only financial institution to doubt the potential for cryptocurrency to replace paper money or gold. Citi (c), for its part, last month threw cold water on the argument that Bitcoin is “digital gold,” as crypto enthusiasts often call it. JPMorgan Chase CEO Jamie Dimon has been similarly dismissive of Bitcoin, going so far as to call it a “fraud” (though he later said he regretted saying so publicly).

Goldman Sachs CEO Lloyd Blankfein has been more open-minded about Bitcoin’s potential, even suggesting that the natural skepticism that comes with new technologies does not necessarily doom them. “Still thinking about #Bitcoin,” Blankfein wrote on Twitter in October. “No conclusion—not endorsing/rejecting. Know that folks were skeptical when paper money displaced gold.”

In an interview last month with CNBC, however, Blankfein shut down rumors that Goldman would open a Bitcoin trading desk.

For now, it seems, Goldman Sachs itself is still far too skeptical to recommend buying Bitcoin.

]]>http://goldcoastmoneyonline.com/2018/02/22/heres-what-bitcoin-must-prove-before-goldman-sachs-would-invest/feed/0Bitcoin Usage Falls to Its Lowest in Monthshttp://goldcoastmoneyonline.com/2018/02/22/bitcoin-usage-falls-to-its-lowest-in-months/
http://goldcoastmoneyonline.com/2018/02/22/bitcoin-usage-falls-to-its-lowest-in-months/#respondThu, 22 Feb 2018 01:03:33 +0000http://goldcoastmoneyonline.com/2018/02/22/bitcoin-usage-falls-to-its-lowest-in-months/There’s never a bad time to be sending and receiving bitcoin, but right now is especially good. Fees are at the lowest in 18 months, with the average transaction value now under a dollar. This contrasts starkly with the latter quarter of last year, when rising fees peaked at $34. There’s a primary reason why …

There’s never a bad time to be sending and receiving bitcoin, but right now is especially good. Fees are at the lowest in 18 months, with the average transaction value now under a dollar. This contrasts starkly with the latter quarter of last year, when rising fees peaked at $34. There’s a primary reason why fees have been dropping since then: with bitcoin too expensive to send, people simply stopped using it as currency.

Bitcoin Fees Take a Tumble

It’s not just the USD/BTC market that oscillates: bitcoin’s fee market follows suit. Due to various factors ranging from network usage to Segwit adoption and hashrate, fees can rise and fall significantly. Throughout 2017, that trajectory was largely an upward one, culminating, in December, with fees becoming infeasible. Transaction fees have been mercifully declining since then, hitting an 18-month low as of February 21, but given that daily transaction volume has halved in the same period, that’s not surprising. A standard six-block transaction can now be pushed through for as little as 15 cents. Bitinfocharts calculates a median fee of 52 cents, versus just over 1 cent for bitcoin cash.

This reduction in transaction fees will not be felt by all bitcoin users however. Anyone withdrawing from an exchange will still be hit with standard fees. Binance and Kucoin, for example, set a flat rate of 0.001 BTC, or around $10.60 at current prices. As Binance CEO Changpeng Zhao pointed out in a recent tweet, though, exchanges have a case for charging above the base rate for the service they’re supplying. Whether they can justify charging upwards of $10 a time is a matter for debate though.

Why the Low Fees?

High transaction fees arguably helped push the “store of value” meme that was popularized on r/bitcoin last year. Saddled with a cryptocurrency that was too expensive to send in small amounts, there was little choice but to hodl and wait for BTC to appreciate in value. Soaring fees were one of the triggers for a number of businesses to stop accepting bitcoin including Stripe and, ironically, the North American Bitcoin Conference. Steam also stopped accepting bitcoin in December, citing “high fees and volatility”. Frustrating as fees have been for users of the bitcoin network, some good has come of this predicament.

Users and exchanges have scrambled to seek out ways of making transactions more efficient, with fixes including batching transactions together and adopting Segwit. Exorbitant fees also spurred quicker trials of the Lightning Network, though its adoption is still too low to have affected current bitcoin fees. Evidence suggests that the biggest driver in fee reduction was not technical, but sociological: on December 17, almost half a million bitcoin transactions were sent. That figure now averages under 200,000 a day.

With fees now at the lowest they’ve been in 18 months, it will be interesting to see whether retailers such as Valve will resume support for cryptocurrencies or steer clear until some sort of stability can be maintained. A number of companies have previously spoken of considering alternative cryptos, with Stripe mentioning litecoin, stellar, and bitcoin cash.

Bitcoin’s real test will come when people resume using the cryptocurrency as a medium of exchange and blocks begin to fill up once more.

Do you think bitcoin fees are now at a reasonable rate, or do they need to fall further still? Let us know in the comments section below.

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]]>http://goldcoastmoneyonline.com/2018/02/22/bitcoin-usage-falls-to-its-lowest-in-months/feed/0How to calculate the exact amount of Bitcoin riches you've missed out onhttp://goldcoastmoneyonline.com/2018/02/22/how-to-calculate-the-exact-amount-of-bitcoin-riches-youve-missed-out-on/
http://goldcoastmoneyonline.com/2018/02/22/how-to-calculate-the-exact-amount-of-bitcoin-riches-youve-missed-out-on/#respondThu, 22 Feb 2018 00:42:55 +0000http://goldcoastmoneyonline.com/2018/02/22/how-to-calculate-the-exact-amount-of-bitcoin-riches-youve-missed-out-on/Image: screenshot/bitcoinregret.club By Monica Chin2018-02-21 19:11:01 UTC The value of Bitcoin has been a roller coaster, and a select few have come out on top. If you, like most of us, are not among the cryptocurrency elite, never fear. The Bitcoin Regret Club, featured on Product Hunt, is here to remind you just how disappointed …

If you, like most of us, are not among the cryptocurrency elite, never fear. The Bitcoin Regret Club, featured on Product Hunt, is here to remind you just how disappointed you should be that you didn’t invest in bitcoin.

The Club’s calculator is very simple. To start, enter a date and an investment amount.

Image: screenshot/bitcoinregret.club

The website works its magic, then tells you exactly how much money you didn’t make from that investment. For example, if I’d invested $400 on June 6 2013, I would now have $35,586.

Image: screenshot/bitcoinregret.club

Helpfully, the site can also tell you how many products you could have bought, had you been a more daring cryptocurrency investor. For example, with my bitcoin non-revenue, I could have bought 177,930 packs of ramen.

]]>http://goldcoastmoneyonline.com/2018/02/22/how-to-calculate-the-exact-amount-of-bitcoin-riches-youve-missed-out-on/feed/0Bitcoin retreats as virtual currency meets resistance near $12000 levelhttp://goldcoastmoneyonline.com/2018/02/21/bitcoin-retreats-as-virtual-currency-meets-resistance-near-12000-level/
http://goldcoastmoneyonline.com/2018/02/21/bitcoin-retreats-as-virtual-currency-meets-resistance-near-12000-level/#respondWed, 21 Feb 2018 21:32:40 +0000http://goldcoastmoneyonline.com/2018/02/21/bitcoin-retreats-as-virtual-currency-meets-resistance-near-12000-level/Digital currencies lost ground Wednesday as overall market sentiment waned, pushing the price of bitcoin back under $11,000. After trading above $11,700 late Tuesday evening, the price of the No. 1 digital currency by market cap, bitcoin BTCUSD, -11.39% lost more than $1,500, trading to a session low of $10,244.32 before trading at $10,324.41 on …

lost more than $1,500, trading to a session low of $10,244.32 before trading at $10,324.41 on Wednesday afternoon, down 8.1%.

After nearly doubling in price since the Feb. 6 low of $5,947.40, traders have begun dumping some of their holdings, market participants said.

“This rebound took a lot of pressure off of BTC owners, but we will start running into overhead resistance,” Jani Ziedins of Cracked.Market said in a research note, referring to trading levels that market technicians view as points where selling tends to be triggered.

“Many premature dip-buyers jumped in between $12k and $15k and we should expect many of those regretful owners to sell when they can get their money back. Their selling will slow the assent over the near-term,” he said.

The news was no better for other major digital currencies. Ether slipped to a one-week low, falling 6.3% to $836.63. Bitcoin cash was down 7.2% at $1,322; Litecoin was lower by 9.2% at $211.88; and Ripple’s XRP coin was trading at $1.02, down 5.9%, according to news and research firm CoinDesk.

In other developments, the persistent debate about the utility of cryptos got its latest critic when Bank of England Gov. Mark Carney said bitcoin had “pretty much failed” as a currency.

]]>http://goldcoastmoneyonline.com/2018/02/21/bitcoin-retreats-as-virtual-currency-meets-resistance-near-12000-level/feed/0Everything you need to know about bitcoin and your taxeshttp://goldcoastmoneyonline.com/2018/02/21/everything-you-need-to-know-about-bitcoin-and-your-taxes/
http://goldcoastmoneyonline.com/2018/02/21/everything-you-need-to-know-about-bitcoin-and-your-taxes/#respondWed, 21 Feb 2018 17:53:32 +0000http://goldcoastmoneyonline.com/2018/02/21/everything-you-need-to-know-about-bitcoin-and-your-taxes/Bitcoin had its coming-out party in 2017. With all the excitement and opportunities around cryptcurrency, it might be easy to forget about crypto taxation. Almost every bitcoin or other “altcoin” transaction — mining, spending, trading, exchanging, air drops, etc. — will likely be a taxable event for U.S. tax purposes. div > div.group > p:first-child”> …

Bitcoin had its coming-out party in 2017. With all the excitement and opportunities around cryptcurrency, it might be easy to forget about crypto taxation. Almost every bitcoin or other “altcoin” transaction — mining, spending, trading, exchanging, air drops, etc. — will likely be a taxable event for U.S. tax purposes.

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Without a doubt, 2018 will be a landmark year for Internal Revenue Service enforcement of cryptocurrency gains. Taxpayers should stay ahead of the game rather than be reactionary. The IRS is always more lenient with taxpayers who come forward on their own accord rather than those that get discovered. Coming forward now actually could be the difference between criminal penalties and simply paying interest.

With only several hundred people reporting their crypto gains each year since bitcoin’s launch, the IRS suspects that many crypto users have been evading taxes by not reporting crypto transactions on their tax returns.

Unfortunately, the IRS has provided very little guidance with regard to bitcoin taxation. One thing, however, is clear: Although both the public and the crypto community refer to bitcoin and altcoins as virtual currencies, the IRS treats them as property for tax purposes. Therefore, selling, spending and even exchanging crypto for other tokens all likely have capital gain implications. Likewise, receiving it as compensation or by other means will be ordinary income.

While bitcoin receives most of the attention these days, it is only one of hundreds of cryptocurrencies. Everything discussed with regard to bitcoin taxation applies to all cryptocurrencies.

Let’s look at specific crypto transactions and their tax implications:

Trading cryptocurrencies produces capital gains or losses, with the latter being able to offset gains and reduce tax.

Exchanging one token for another — for example, using Ethereum to purchase an altcoin — creates a taxable event. The token is treated as being sold, thus generating capital gains or losses.

Receiving payments in crypto in exchange for products or services or as salary is treated as ordinary income at the fair market value of the coin at the time of receipt.

Spending crypto is a tax event and may generate capital gains or losses, which can be short-term or long-term. For example, say you bought one coin for $100. If that coin was then worth $200 and you bought a $200 gift card, there is a $100 taxable gain. Depending on the holding period, it could be a short- or long-term capital gain subject to different rates.

Converting a cryptocurrency to U.S. dollars or another currency at a gain is a taxable event, as it is treated as being sold, thus generating capital gains.

Air drops are considered ordinary income on the day of the air drop. That value will become the basis of the coin. When it’s sold, exchanged, etc., there will be a capital gain.

Mining coins is considered ordinary income equal to the fair market value of the coin the day it was successfully mined.

Initial coin offerings do not fall under the IRS’s tax-free treatment for raising capital. Thus, they produce ordinary income to individuals and businesses alike.

Although specific identification of the particular coin being sold or exchanged would allow taxpayers to manage their short- and long-term capital gains, exchanges and wallets are currently not set up to choose which coins to sell or exchange. Therefore, the IRS will likely default to First-In-First-Out treatment, although no guidance has been provided, so taxpayers are allowed to pick their methodology as long as it is consistent throughout the return.

That being said, the best way to minimize is to buy and hold for more than a year. Short-term capital gains are taxed at your normal ordinary income tax rate while long-term gains are taxed at a reduced rate (15 percent to 23.8 percent, depending on your bracket). Of course, given the volatility, it still might be in your best interest to lock in the profit now and take the tax hit, but that is up to you to decide.

Digital exchanges are not broker-regulated by the IRS, which makes matters more complicated for preparing tax documents if you traded cryptocurrency. Exchanges do not issue a 1099 form, nor do they calculate gains or cost basis for the trader. Many don’t even allow transacting in dollars, instead opting for Ethereum. This means that self-reporting is necessary.

Exchanges are starting to take note of tax reporting, however. Coinbase, for example, now provides a Form 1099-K, but only to certain business users and GDAX users who have received at least $20,000 cash for sales of cryptocurrency related to at least 200 transactions in a calendar year.

Other users need to use their account transaction history. The reporting of gains/losses and cost basis is still in beta and not guaranteed to be accurate. Therefore, we strongly recommend keeping detailed records of all crypto transactions at all exchanges in order to have all the crypto information needed for your U.S. tax return. Those records include dates of earning, buying or exchanging coins, market value at that date to calculate cost basis and the date and sales proceeds when a coin is sold, exchanged or spent.

Fortunately, there are some services available that can take your trading history and provide you with a fairly clean output for Schedule D on your tax return. Many investors have used bitcoin.tax and cointracking.info, for example.

]]>http://goldcoastmoneyonline.com/2018/02/21/everything-you-need-to-know-about-bitcoin-and-your-taxes/feed/0A Computer Glitch Let a Trader Claim $20 Trillion in Free Bitcoinhttp://goldcoastmoneyonline.com/2018/02/21/a-computer-glitch-let-a-trader-claim-20-trillion-in-free-bitcoin/
http://goldcoastmoneyonline.com/2018/02/21/a-computer-glitch-let-a-trader-claim-20-trillion-in-free-bitcoin/#respondWed, 21 Feb 2018 16:41:25 +0000http://goldcoastmoneyonline.com/2018/02/21/a-computer-glitch-let-a-trader-claim-20-trillion-in-free-bitcoin/An error in the price calculation system at Japanese cryptocurrency exchange Zaif has allowed some customers to claim digital tokens for free—including one who “purchased” $20 trillion worth of Bitcoin. That’s problematic on a number of levels, but among those is the fact that the total Bitcoin market capitalization is around $183 billion, according to …

An error in the price calculation system at Japanese cryptocurrency exchange Zaif has allowed some customers to claim digital tokens for free—including one who “purchased” $20 trillion worth of Bitcoin.

That’s problematic on a number of levels, but among those is the fact that the total Bitcoin market capitalization is around $183 billion, according to CoinMarketcap.

Officials at Zaif tell Japanese newspaper Asahi Shimbun that the glitch lasted 18 minutes. Seven people took advantage of it—one of whom (the one who tried to get their hands on $20 trillion worth) tried to cash out.

Tech Bureau, which owns the Zaif exchange, has invalidated the transactions and corrected user balances. However, the company is now being investigated by Japan’s Financial Services Agency (FSA) about the security of its system as well as other business practices.

The added scrutiny comes just weeks after the FSA reportedly raided Tech Bureau to investigate its internal governance structure after the hacking of Coincheck, which saw thieves make off with over $500 million in cryptocurrency.

]]>http://goldcoastmoneyonline.com/2018/02/21/a-computer-glitch-let-a-trader-claim-20-trillion-in-free-bitcoin/feed/0Here's what can happen if you don't pay taxes on bitcoinhttp://goldcoastmoneyonline.com/2018/02/21/heres-what-can-happen-if-you-dont-pay-taxes-on-bitcoin/
http://goldcoastmoneyonline.com/2018/02/21/heres-what-can-happen-if-you-dont-pay-taxes-on-bitcoin/#respondWed, 21 Feb 2018 16:04:33 +0000http://goldcoastmoneyonline.com/2018/02/21/heres-what-can-happen-if-you-dont-pay-taxes-on-bitcoin/In 2017, bitcoin went from trading at below $1,000 early in the year to a peak of over $19,000 in December, while other virtual currencies also enjoyed gains. div > div.group > p:first-child”> For anyone who ignored the common crypto-slang advice to “HODL,” to hold on to your investment for dear life, and decided to …

In 2017, bitcoin went from trading at below $1,000 early in the year to a peak of over $19,000 in December, while other virtual currencies also enjoyed gains.

div > div.group > p:first-child”>

For anyone who ignored the common crypto-slang advice to “HODL,” to hold on to your investment for dear life, and decided to cash out, those profits are considered income by the IRS.

If you sold crypto-coins or used crypto to buy anything in 2017, you probably owe the IRS taxes, says Ryan Losi, a certified public accountant and the executive vice president of Virginia accounting firm PIASCIK.

“For Americans there is no free lunch,” Losi says. “If you’re richer tomorrow than you were today, it is likely you have some tax burden associated with that.”

And not paying up can have consequences.

If the IRS discovers you under-reported your income when you file your taxes in April, “there is a failure-to-pay penalty of 0.5 percent per month, starting after the month in which it was due,” Losi explains. “Then there is a failure-to-pay penalty of 5 percent on top of that.” Then, there’s interest.

To avoid penalties, here’s what you need to know about paying taxes on bitcoin.

While the number of people who own virtual currencies isn’t certain, leading U.S. cryptocurrency exchange Coinbase had an estimated 11.7 million users at the end of October 2017, according to data compiled by Alistair Milne, co-founder and chief investment officer of Altana Digital Currency Fund. (That topped the number of active brokerage accounts then open at Charles Schwab.)

But unlike with traditional investments, in which case you’re likely to be issued a 1099 form (which is also sent to the IRS) to keep track of your holdings and tax obligations, that isn’t necessarily the case with virtual currency. Coinbase will provide 1099 forms to “certain business customers” and “customers that have received at least $20,000 cash for sales of virtual currency related to at least 200 transactions in a calendar year,” according to the company’s customer support page.

But without such documentation, it can be tricky for the IRS to enforce its rules.

“[For] now it is difficult for the IRS to really find out on an individual basis whether you reported your virtual currency sales or exchanges,” Losi says.

Recently however, the IRS has taken steps to identify tax-payers who are profiting, but not reporting.

In 2016, the IRS summoned records from Coinbase, and a court ruled the company had to disclose information on about 14,000 users who have “either bought, sold, sent or received at least $20,000 worth of bitcoin in a given year,” CNBC reports.

Even if you aren’t a hefty Coinbase user, you’re obligated to report, and every U.S. taxpayer can potentially be audited by the IRS. The IRS examined 0.6 percent of the 193 million tax returns filed in fiscal year 2016, or about 1.2 million.

In 2014, the IRS first issued official guidance on how to treat virtual currencies, which outlined that they are considered property.

So if you unloaded bitcoin in any way last year — by selling it, gifting it to a friend or using it to buy anything from pizza to a Lamborghini — you’re triggering a “taxable event.” And you’re then responsible for paying taxes on the appreciation of the virtual currency from the price at which you bought it, to the price at which you sold (or spent) it.

For example, if you paid for a house using bitcoin, whatever your actual methods, the IRS thinks of it this way: You sold bitcoin for cash and used cash to buy a home. So, you’re obligated to pay taxes on how much the bitcoin appreciated from the time you invested up until the time you shelled out for the house.

That gain can be taxed at different rates. If you held a virtual currency for over a year before selling or paying for something with it, you pay a capital gains tax, which can range from 0 percent to 20 percent. Use Form 8949 to report it. If you held for less than a year, you pay ordinary income tax.

If you just bought and held last year, then you don’t owe taxes on the asset’s appreciation because there was no “taxable event.” Like with stocks, bonds or any other investment on which you might pay capital gains, you only have to pay after you sell or exchange virtual currency.

If you just bought and held, “there is no triggering of gain that you would recognize on a 2017 tax return,” Losi says.

If you’re transacting with crypto-coins frequently, you’ll want to keep diligent notes on the prices at which you buy and cash out.

“You really, really need to have documentation down,” Losi says. “If you can not prove your [cost] basis,” he explains, referring to the price at which you purchased, “guess how much is taxable? Not the gain, the gross proceeds.”

Here’s an example to demonstrate: If you bought a cryptocurrency at $5 and sold it for $10, you should only be taxed on the gain, the $5 increase. But if you don’t have proof that you bought at $5, you’re taxed on the amount you sold it for, the $10 total.

To keep track of all of your transactions, Tyson Cross, a tax attorney in Reno, Nevada recommends to CNBC that you frequently download reports of your transaction histories from whatever exchanges you use and keep them for your files.

“Losses can be used to offset capital gains, subject to certain rules, and losses that are not used to offset gains can be deducted — up to $3,000 — from other kinds of income,” The New York Times explains. For more information on a strategy called “tax-loss harvesting,” see CNBC’s explainer here.

Zaif informed users about the glitch in a post on their site Tuesday, Jan. 20, explaining that for 18 minutes on Feb. 16 users accidentally found themselves able to ‘trade’ yen for virtual currency — at an exchange rate of 0 yen per coin.

Asahi Shimbun reports that seven users where able to obtain crypto for “free”, but the exchange managed to cancel all illicitly-gained transactions.

Asahi Shimbun reports that one “buyer” made an attempt to sell 2,200 trillion yen (about $20 trillion) in Bitcoin before the problem was resolved.

Zaif’s Twitter posts reveal further criticism from users, who complain about poor backend performance and lack of support.

The latest difficulties comes as Zaif gains increased regulatory scrutiny in the wake of January’s $530mln hack of Japanese crypto exchange Coincheck.

Despite the security lapse, Japan’s licensing system for exchanges has seen considerable popularity since an legal overhaul of the space in April 2017.

Licensed members will even form part of an umbrella self-regulatory group from April this year, with details still to be ironed out, Cointelegraph recently reported.

Meanwhile, technical errors on mainstream consumer interfaces are far from unheard of. In January, 2018 online retailer Overstockrevealed a glitch that resulted in customers being able to choose between Bitcoin and Bitcoin Cash as payment options, with the price figure remaining the same.

Related

]]>http://goldcoastmoneyonline.com/2018/02/21/japan-zaif-exchange-reports-glitch-20-trillion-in-btc-temporarily-purchased-for-0-yen/feed/0How To Transfer Bitcoin Without Triggering Taxeshttp://goldcoastmoneyonline.com/2018/02/21/how-to-transfer-bitcoin-without-triggering-taxes/
http://goldcoastmoneyonline.com/2018/02/21/how-to-transfer-bitcoin-without-triggering-taxes/#respondWed, 21 Feb 2018 14:55:06 +0000http://goldcoastmoneyonline.com/2018/02/21/how-to-transfer-bitcoin-without-triggering-taxes/1031 tax-free exchanges can no longer be used for crypto. There any other ways to transfer crypto without triggering taxes, but there is no silver bullet. Still, there are some worth considering on the right facts. For example, how about gifts? (Photo by Chesnot/Getty Images) You can give crypto as a gift, and it doesn’t trigger …

1031 tax-free exchanges can no longer be used for crypto. There any other ways to transfer crypto without triggering taxes, but there is no silver bullet. Still, there are some worth considering on the right facts. For example, how about gifts?

(Photo by Chesnot/Getty Images)

You can give crypto as a gift, and it doesn’t trigger income taxes. That’s right, no income tax to you as the donor, and no income tax to the recipient. Of course, when the recipient transfers or sells it, there would be income taxes&nbsp;then. And at that point, the donee would need to calculate gain or loss. What is his or her tax basis, since it was a gift? The tax basis is the same as it was in your hands when you made the gift.

However, keep in mind that to avoid income taxes, a gift has to&nbsp;really&nbsp;be a gift. The tax law is littered with cases of people who claimed something was a gift, but who got stuck with income taxes. With gifts not being subject to income taxes, it can seems tempting to&nbsp;try to characterize money or property you receive as gifts. But be careful: the IRS hears this ‘it was a gift’ excuse a lot. And the IRS is unlikely to be persuaded unless you can document it.

Plus, the IRS&nbsp;usually expects a gift to occur in a normal gift-like setting. For example, if an employer or former employer gives a loyal employee $10,000 is that a gift? No, it is a bonus, treated as wages. Even trying to document it as a gift may not change that result. True gifts may not trigger any&nbsp;income&nbsp;taxes, but there could be&nbsp;gift&nbsp;taxes involved. If you give crypto to a friend or family member—to anyone really—ask how much it is worth. If the gift is worth more than $15,000, it requires you to file a gift tax return. For 2018, $15,000 is the amount of so-called “annual exclusion.” You can give gifts up to this amount each year to any number of people with no reporting required.

Any gifts over that $15,000 amount require a gift tax return, even though you may not have to &nbsp;pay any gift tax. Rather than paying gift tax, you normally would use up a small portion of your lifetime exclusion from gift and estate tax. For 2018, that number went up dramatically. The amount you can transfer tax-free during your life or on death just went up to $11.2 million per person. That is $22.4 million per married couple.

What if your gift isn’t to a person, but to charity? If you give to charity, that can be very tax-smart from an income tax viewpoint. If you give crypto to a qualified charity, you should normally get an income tax deduction for the full fair market value of the crypto. If you bought it for $500, and donate to a 501(c)(3) charity when it is worth $15,000, you should get a $15,000 charitable contribution deduction.

What’s more, you won’t have to pay the capital gain or income tax on the $14,500 spread. That’s a good deal. It’s why most savvy people—think Warren Buffett—want to donate appreciated property rather than money to charity. Remember, if you use crypto to buy something, the IRS considers that a sale of your crypto. You have to calculate gain or loss. You might have bought something with your crypto. But you made a sale in the process.

Also take note of the IRS enforcement efforts. The IRS is looking for reporting of crypto, thanks to summonses, tracking software, and training its criminal IRS agents. That should make a lot of people who might have been lax in the past starting to think more carefully about April 15th.

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2017 may have been the year of the crypto investor, and returns were beyond heady. But it’s 2018 now, and interest in crypto remains high. It may even be more mainstream now than it was last year. Taxes are a worry of course, and they are arguably more difficult than last year. For one, it is clear that so-called 1031 tax-free exchanges can no longer be used for crypto. There any other ways to transfer crypto without triggering taxes, but there is no silver bullet. Still, there are some worth considering on the right facts. For example, how about gifts?

(Photo by Chesnot/Getty Images)

You can give crypto as a gift, and it doesn’t trigger income taxes. That’s right, no income tax to you as the donor, and no income tax to the recipient. Of course, when the recipient transfers or sells it, there would be income taxesthen. And at that point, the donee would need to calculate gain or loss. What is his or her tax basis, since it was a gift? The tax basis is the same as it was in your hands when you made the gift.

However, keep in mind that to avoid income taxes, a gift has toreallybe a gift. The tax law is littered with cases of people who claimed something was a gift, but who got stuck with income taxes. With gifts not being subject to income taxes, it can seems tempting to try to characterize money or property you receive as gifts. But be careful: the IRS hears this ‘it was a gift’ excuse a lot. And the IRS is unlikely to be persuaded unless you can document it.

Plus, the IRS usually expects a gift to occur in a normal gift-like setting. For example, if an employer or former employer gives a loyal employee $10,000 is that a gift? No, it is a bonus, treated as wages. Even trying to document it as a gift may not change that result. True gifts may not trigger anyincometaxes, but there could begifttaxes involved. If you give crypto to a friend or family member—to anyone really—ask how much it is worth. If the gift is worth more than $15,000, it requires you to file a gift tax return. For 2018, $15,000 is the amount of so-called “annual exclusion.” You can give gifts up to this amount each year to any number of people with no reporting required.

Any gifts over that $15,000 amount require a gift tax return, even though you may not have to pay any gift tax. Rather than paying gift tax, you normally would use up a small portion of your lifetime exclusion from gift and estate tax. For 2018, that number went up dramatically. The amount you can transfer tax-free during your life or on death just went up to $11.2 million per person. That is $22.4 million per married couple.

What if your gift isn’t to a person, but to charity? If you give to charity, that can be very tax-smart from an income tax viewpoint. If you give crypto to a qualified charity, you should normally get an income tax deduction for the full fair market value of the crypto. If you bought it for $500, and donate to a 501(c)(3) charity when it is worth $15,000, you should get a $15,000 charitable contribution deduction.

What’s more, you won’t have to pay the capital gain or income tax on the $14,500 spread. That’s a good deal. It’s why most savvy people—think Warren Buffett—want to donate appreciated property rather than money to charity. Remember, if you use crypto to buy something, the IRS considers that a sale of your crypto. You have to calculate gain or loss. You might have bought something with your crypto. But you made a sale in the process.

Also take note of the IRS enforcement efforts. The IRS is looking for reporting of crypto, thanks to summonses, tracking software, and training its criminal IRS agents. That should make a lot of people who might have been lax in the past starting to think more carefully about April 15th.